In the space of one year there has been a dramatic rise in the number of counterfeit medicines seized in the European Union.

In 2005 there were five hundred thousand fake medicines discovered - last year that figure shot up to 2.5 million.

More and more people are becoming concerned that some of these fake drugs might be entering the legitimate supply chain via what is known as the parallel trade in medicines.

One of those is Jim Thompson who has just set up an organisation called the European Alliance for Access to safe medicines.

"This trade is perfectly legal but the problem is these drugs will be passing through many hands. There is no audit trail for that drug. It might travel through one hand, fifteen or 25, who knows?"

Setting the price

Each government in the EU sets the price of drugs in its country. In the UK, where buying power is higher than poorer countries in Southern Europe, drugs are more expensive than say Greece or Spain.

So dealers can buy them up and sell them to the UK at higher prices.
They will have to be repackaged in new boxes or English labels are stuck over the foreign writing.

The trade is not as simple as a drug being sold from a wholesaler in one country to a distributor in Britain. It could be repackaged first in another country, say France, then sold to a wholesaler there and passed on again to a third or even a fourth country where it might be repackaged yet again.

This summer three different types of fake medicines were seized in the UK which had been imported via parallel trade.

Tests showed the drugs, Plavix, Casodex and Zyprexa, prescribed to heart, cancer and psychiatric patients, contained less active ingredient than the genuine medicine and investigations are ongoing to establish if they contain other harmful ingredients.

Zyprexa is made by Eli Lilly. Tom Thorp, Lilly's anti counterfeiting spokesperson, believes parallel trade compromises patient safety, and not just by providing an opening for counterfeiters

"When parallel traders repackage mistakes have occurred. The wrong product may be put into boxes or the wrong patient information leaflet. We have seen problems with the day markings on the contraceptive pill not being in English so people might be taking them at the wrong time."

Target for counterfeiters?

Aside from errors like that the big drug companies believe that the parallel trade is likely to be increasingly targeted by drug counterfeiters.

Julian Mount, Vice President of European Trade and Mature Brands for Pfizer Pharmaceuticals Worldwide, points out that for dealing a Class A drug the maximum penalty is life imprisonment.

Under the Medicines Act you are likely to receive just two to three years in jail for dealing in counterfeit medicines. And he says there are far greater profits to be made from counterfeit medicines.

Pfizer has now begun to insist that pharmacists sign an exclusive contract to be supplied with drugs from Pfizer designated wholesalers, so they can no longer shop around the medicines market nor buy through the parallel trade.

Pfizer is now insisting that pharmacists buy exclusively from pre-approved wholesalers

Julian Mount says: "We could not guarantee the supply of authentic medicines to all pharmacy patients. Due to this proliferation of medicines trading and to make sure every pharmacist gets quality assured packs we had to take decisive action." Pfizer denies that this move has anything to do with maximising their profits.

Some pharmacists say this has meant that they have suffered shortages of certain Pfizer drugs. But the company insists that any hold ups are due to manufacturing or regulatory issues. And since the new system was introduced Pfizer says 99 per cent of orders have been delivered on time and in full.

The parallel trade industry itself argues that its checks and safeguards are just as rigorous as those of the major drug manufacturers.

It says there is no link between parallel trade and counterfeits and that the suggestion by some in the industry to link the two is a deliberate attempt to tarnish a legitimate and safe practice that poses competition to the major pharmaceutical industries.

Regulation

However, the big drug companies are also concerned about the regulation of the parallel trade, concerns backed up by individual campaigners. Graham Satchwell, a former detective superintendent, managed to get a licence to import medicines for a bogus company he set up.

"I applied with a false name and false details for a wholesale dealers licence. My phoney company was subject to a very cursory inspection and that was it. We are not short of regulations and laws but they are not being enforced."

The Medicines and Healthcare Products Regulatory Agency insists that checks have been tightened since then and says enforcement is thorough. Michael Deats the head of enforcement and intelligence at the MHRA says.

"We have one of the largest enforcement divisions in the world. 42 people, lawyers, investigators, analysts. We deal robustly with our investigations and at the moment we are coping with our referrals. Should that change I will not be slow in asking for more resources."

BBC Radio 4's Crossing Continents is broadcast on Thursday, 6 September 2007 at 1102 BST and repeated on Monday, 10 September 2007 at 2030 BST.